Organizational Communication

Organizations cannot operate without communication. Communication can take

various forms but all forms involve the transfer of information from one party to
the other. In order for the transfer of information to qualify as communication, the
recipient must understand the meaning of the information transferred to them. If
the recipient does not understand the meaning of the information conveyed to
them, communication has not taken place.
Communication is the life source of organizations because organizations involve
people. People cannot interact with each other without communication. In the
absence of communication, everything would grind to a halt. For example;
The workers in an organization would not know the organization’s objectives so
they would not strive to achieve the organization’s objectives.
• The workers in an organization would not know what their roles and
responsibilities were, so they would not be able to carry out their daily tasks
and duties.
• The managers would not be able to train their workers reports so the workers
would not possess the skills they needed to carry out their jobs.
• The managers would not be able to inform workers of changes
• The organization would not be aware of their competitors activities
Communication in an organization may be used to influence, inform, control or
inspire. Organizational communication can be divided into two broad categories -
formal or structured (within the 'systems' established by management) and informal
(as when co-workers chat about company matters). Both areas are significant and
both need to be 'healthy' for the organization to be healthy

On the whole people are able to communicate with each other as this is a basic
human function. However successful organizations strive not only for
communication but effective communication.

Formal communication channels and networks

Formal communication channels follow the organizational structure or hierarchy
and flow in four directions:

These four directions in which communication can travel are: downward; upward;
horizontal; and diagonal.
Downward (1) communication involves communication from higher to lower
levels so that leadership can communicate goals, strategies or role expectations.
Upward (2) communication flows from lower levels to higher levels of the
organization, for example, when there is a need to communicate problems, results
or suggestions.
Horizontal (3) communication occurs across the same level and involves for
example, coordination of activities with peers (teams, committees), dissemination
of useful information from one department to another (for example sales forecasts
from the sales department to production, and problems such as a problem with
product design from the production department to research and development).
Horizontal communication facilitates the l inking of different areas of expertise and
this may encourage innovation.

Diagonal (4) channels may potentially cause conflict as they involve

communication between the lower levels of one department to a higher level in
another. In the diagram above, this may cause friction between the employee in
accounting department C and the Vice-President (VP) of Accounting as the
employee has gone around his or her own superior. Nevertheless this type of
communication may be useful as it may simply be information relevant to the
Marketing Department and the VP Accounting does not need to be involved.
Formal communication networks also occur within the hierarchy of the
organization and reflect how groups of employees work together. Mapping the
flow of communication in an organization can be a useful device. This can identify
who is communicating with whom and whether the lines of communication are
effective and efficient, or whether there is potential for destructive conflict or
tension arising from the communication channels.

Informal communication
Informal organizational communication exists outside the formal lines of the
organizational structure. An example of this is friendship groups. The informal
communication channel serves two main purposes: it permits employees to satisfy
their need for social interaction in the workplace and it can improve an
organization’s performance by creating alternative, and frequently faster and more
efficient, channels of communication .
One of the most common forms of informal communication is 'the grapevine'.
According to Kreitner and Kinicki (1995) the term grapevine originated from the
American Civil War practice of stringing battlefield telegraph lines between trees
as a means of efficient communication. In organizations today, the grapevine
supplements the formal channels of communication. Although it can be the source
of inaccurate rumors, it often functions positively as an early warning signal for
organizational changes, as a mechanism for fostering social interaction and
cohesiveness between organizational members and as a way of informally sharing
and testing ideas.
Advantages of Grapevine Communication
Grapevine communication creates a social bond where none existed. People like to
talk to one another; whether they talk about work or family, or anything. Teams
become more cohesive when members talk to one another outside of the project or
assignment they may be working on. Informal communication lends itself to
bonding.
The grapevine fills in a gap that is left when official information is missing,
especially in chaotic or changing times. Even in organizations where management
is very proactive about communicating change and keeping employees informed,
the grapevine helps to fill in the blanks.
The grapevine in many ways helps keep people honest; it can dissuade people from
engaging on behavior that they don’t want others to know about. This is a two edge
sword. On one hand, people will think twice about taking what they know is a
wrong course of action. On the other hand, they may also think twice about taking
a necessary risk and doing the right thing, fearful those appearances that may give
rise to rumors.

Disadvantages of Grapevine Communication

There are some intrinsic dangers in bypassing the organizational channels to get to
the facts of the matter. The main danger is that much of the information that gets
spread through the grapevine is not verified. Some of the information is likely false
and difficult, if not impossible, to verify.
We discount information when the source is a known gossiper. But not completely.
Even when the source is someone known to spread rumors, we believe that where
there's smoke. Since we don’t know what part is fire and what smoke is, we accept
the whole rumor. To justify our participation in spreading the rumor, we tell
ourselves that part of it must be true.
The main reason why we give credence to a rumor is that it seems to match what
we think about the situation or person that the rumor is about. We also tend to
believe the person sharing the rumor with us.
Another main disadvantage of grapevine communication is that it's often used to
spread more than rumors; it's used to spread gossip.
The terms rumors and gossip are used sometimes interchangeably, but rumors are
not quite the same as gossip. Both are pieces of information that can't be verified,
but rumors tend to affect organizations or groups of people, while gossip refers to
more personal matters.
When gossip is being spread through the grapevine, people's reputations, careers,
and lives can get destroyed very rapidly.

Improving organizational communication

Effective and efficient organizational communication is crucial to goal
achievement. It requires analysis and understanding of the organization’s structure
as well as the necessity for employees to demonstrate competent communication
skills like those presented in previous chapters

Wal Mart enters India

On November 27, 2006, Wal mart stores signed a MoU and entered in a joint
venture with Bharti Enterprises Ltd, a leading business group in India. This joint
venture marked the entry of Wal Mart into the Indian retailing Industry.
At present Bharti-Wal mart Pvt Ltd is into wholesale cash and carry operations.
Wal-Mart intended to operate in the retail format. However, the guideline of Indian
government does not allow any multi brand retail operator to function in the
country, though 51% FDI is allowed for single brand retailers. Multi brand retail
operators are those which keep merchandise of different brands in their stores like
Shopper’s Stop in India. Single brand retailers are those which keep merchandise
of only one brand like Nike, Adidas.
Bharti – Wal mart Pvt Ltd wholesale cash and carry operations caters to the kirana
shops or grocery shops, restaurants, fruit and vegetable sellers and other such
businesses.
Wal mart is known for its logistics, supply chain management, inventory
management,GPS for trucks tracking ,retail information systems etc. ,which it has
brought along to India which will change the face of the Indian retailing industry.
The stores operated by Bharti Wal-Mart Pvt Ltd are named Best Price Modern
Wholesale.
Any foreign company entering India brings, first and foremost, employment
opportunities and so has Wal mart. The efficient supply chain management
practices brought by Wal Mart help to minimize wastage, reduce cost of operations
and maximize value for key stakeholders.

Bharti Wal Mart aims at opening 100 stores every year but due to stringent FDI
policies of Indian government, which is no FDI for multi brand retailers, Bharti
Wal mart can open only 8 to 10 stores per year which is not in accordance with the
goals of Bharti Wal Mart. This has forced Indian government to consider allowing
FDI for multi brand retailers.
Though they aim at 100% but right now Bharti Wal mart seeks only 49%. The
government has taken a tentative step towards to open the sector.
However some people are not in the favor of allowing FDI to such an extent
because they think that such a step will drive the local Kirana shops out of
business which is the only source of income for many households in India.
However, if we the past records, any step taken towards liberalization has proved
to be good for the country and the people.
Thus, FDI should be allowed at least up to 49% in the Multi-Brand Retail so as to
encourage more and more foreign players in India because in the end our country
is getting benefitted.
One a personal level, even I want the same as above so that foreign retail giants
Wal-Mart, Tesco, Carrefour SA can also enter and explore India and result in
Indian retailers learning some of the best practices in retailing and ultimately create
huge job opportunities for us ,MBA retail management graduates.